May surged from lowest intraday price since Feb. 27 as May options expired. Unfixed mill call position in May outweighed that of producers by a wide margin. Outstanding loans fell to 2.239 million bales.
Cotton futures rallied off new lows for the move to settle higher in heavy trading Friday in the face of broad losses in commodities.
Most-active May surged from a 117-point loss at 83.46 cents around noon CDT to a 140-point gain at 86.03 cents and settled up 92 points at 85.58 cents, in the upper quarter of the 257-point range, as May options expired. It ticked last at 86.01 cents after hitting the lowest intraday price since Feb. 27 and then exploding to just shy of ThursdayΆs high.
July settled up 88 points to 87.62 cents, trading within a 245-point range from 85.49-87.94, and December closed up 68 points to 86.34 cents, trading within a 198-point span from 84.67-86.65.
Cotton and grains bucked widespread losses elsewhere in commodities as U.S. retail sales figures for March fell the most in nine months after government data earlier this week showed payrolls expanded by 88,000 last month, the smallest increase since June.
The market still lost ground for the second week in a row, dropping 121 points in May, 95 points in July and 37 points in December.
Volume climbed to an estimated 57,400 lots from 40,377 lots the previous session when spreads totaled 22,727 lots or 56%, EFS 4,136 lots and EFP 32 lots. Options volume totaled 7,311 calls and 6,541 puts.
Unfixed on-call positions in May fell 2,743 lots to 7,911 on the mill side and 686 lots to 770 on the producer side last week, according to the latest call data from the Commodity Futures Trading Commission.
The net call difference thus declined 2,057 lots to 7,141, which was 8.09% of MayΆs declining open interest, up from 7.64% a week earlier. The non-priced mill position outweighed that of producers by a ratio of 10:27:1, up from 7.32:1.
In July, mills increased their unfixed holdings 511 lots to 19,488 and producers added 205 lots to hike theirs to 3,406. This widened the net call difference 306 lots to 16,482, which represented 21.63% of JulyΆs rising open interest, down from 32.87%, while the unfixed ratio narrowed a bit to 5.72:1 from 5.93:1.
Modest changes in December saw the net call difference widen 292 lots to 6,687, 15.1% of the open interest, with mills having 1.63 contracts to price for every one by producers.
Meanwhile, U.S. all-cotton loans outstanding fell 131,608 lots during the week ended Tuesday on repayments on 131,753 bales and entries of 145 bales, USDA reported.
This left loans outstanding of 2,238,978 bales, including 215,847 bales of Form A loans issued to individual growers and 2,023,131 bales of Form G loans issued to cooperatives or loan servicing agents. Outstanding upland loans declined 121,789 bales to 2,024,738.
Futures open interest expanded 3,398 lots Thursday to 210,629, with MayΆs down 4,283 lots to 54,269, JulyΆs up 6,391 lots to 105,153 and DecemberΆs up 1,310 lots to 48,861. The board total was down 265 lots from a week ago.
Certificated stocks grew 8,135 bales to 449,528, up from 421,559 a week ago and a new high since June 2010. Awaiting review were 30,757 bales.
World values as measured by the Cotlook A Index dropped 40 points Friday morning to 92.20 cents. The index premium to ThursdayΆs May futures settlement widened 31 points to 7.54 cents, up from 6.52 cents last week.
